Business and New Markets – BORGENhttps://www.borgenmagazine.com
Humanity, Politics & YouMon, 18 Feb 2019 09:30:23 +0000en-UShourly1https://wordpress.org/?v=5.0.3The Importance of Microcredit in Russiahttps://www.borgenmagazine.com/the-importance-of-microcredit-in-russia/
Tue, 29 Jan 2019 21:30:31 +0000http://www.borgenmagazine.com/?p=130795MOSCOW, Russia — Starting a business in a modern-day Russia today requires navigating arduous geopolitics and market dynamics. Although the two factors are intertwined in business development within Russia, the application for microcredit in Russia chiefly concerns market dynamics. Microcredit in Russia is a catch-all solution to the issue of bringing economic freedom to its [...]

]]>MOSCOW, Russia — Starting a business in a modern-day Russia today requires navigating arduous geopolitics and market dynamics. Although the two factors are intertwined in business development within Russia, the application for microcredit in Russia chiefly concerns market dynamics. Microcredit in Russia is a catch-all solution to the issue of bringing economic freedom to its business owners and consumers.

Russian Economy

As of 2016, GDP per capita for Russian citizens lies just above $10,700 (measured in purchasing power parity). This same figure for the average United States citizen is over $59,500. The comparison between economic freedom and GDP per capita between Russia and the United States requires context. America belongs to the camp of developed, first-world nations, whereas its Eastern hemispheric counterpart is one peg lower on the hierarchical ladder of economic strength. Russia is joined by more than 100 other developing nations striving for modern solutions to archaic business issues that continue to disenfranchise its populations.

Since the fall of the Soviet Union in 1991, market dynamics within Russia have stifled business development and deterred trade and foreign direct investment from multinational firms. The U.S. Department of Commerce notes that the increasing state dominance of the economy, high costs of borrowing and a lack of broad economic reform stunt growth and development. Generally, large U.S. multinationals and publicly-traded companies have exercised caution in conducting business within Russia. By 1992, Russia experienced a 14 percent decline in GDP. This signaled to the rest of the world that broad financial reform was in order.

Despite Russia’s historically unfriendly business environment, America’s lead rating agencies Standard and Poors and Moody’s upgraded the country ratings to BB+ for risk of doing business in Russia, a step below investment grade. In the wake of uncertainty, an alternative solution may bring economic growth to the small and medium-sized enterprises that span through Russia’s 17 million square kilometers and that has 140 million consumers. Rather than of relying on foreign direct investment (FDI) from abroad, Russia must begin to implement its own business loan financing system to incentivize owners of small and medium-sized businesses to take on risk, open shop and stimulate the Russian economy.

Microcredit Definition and History

Microcredit, also known as micro banking and microfinancing, concerns one business owner and one bank with no middle-man in between. Small loans are given to an individual or group of stakeholders who give up little or no collateral in exchange for a series of small loans to finance new business activity in an area or industry. The loan is specifically granted to individuals belonging to rural or impoverished areas and serves to economically revitalize undeveloped areas or nations.

The first microcredit loan was granted in 1976 by Dr. Muhammad Yunus, a young Bangladeshi economist who observed a large majority of the world held in poverty due to their inability to take on debt as a means of rising out of poverty. Yunus set up the first private microcredit bank in the world in order to solve this suboptimal state. Implementing a nationwide microcredit program in Russia would follow the standard course of financing as it was pioneered almost 50 years ago and bring more money and power to its ambitious yet disadvantaged citizens.

Microcredit in Russia

Russia is the 11th largest economy by nominal gross domestic product. This basically means that the country is ranked 11th in the world in terms of the wealth it creates within its borders via the producing and selling of goods and services. There is a business case for microcredit in Russia, but in order for it to potentially succeed, loans must be issued to developing industries that show economic growth within the Russian economy. Russia is experiencing a transition to Western capitalism whereby a newfound focus on consumption, retail and business development has captured younger generations of thinkers, innovators and entrepreneurs. Widespread microcredit in Russia will serve the financial needs of those individuals.

Microcredit in Russia has been around since the financial crisis in 1998 that hit the country hard and subsequent maturation. From 2004 to 2014, the portion represented by officially registered microfinance organizations (MFO) grew by a factor of 11. As of 2014, the portfolio of official microcredits is valued at approximately $1.4 billion. Compared to the industry-heavy development within Russian business, MFOs have a long way to go before they can achieve mainstream implementations and benefits.

Although Russia flaunts its wealth in oil, natural gas and precious metals exports, the country is impoverished. Small and medium-sized businesses open and close shortly after due to the government’s lack of prioritization of loan financing and economic sustainability of small businesses.

In order to support MFOs in Russia, an additionally proposed solution to the geopolitical sphere of Russia concerns lobbying efforts on behalf of multinationals and individuals interested in doing business in Russia. Once Russia realizes the rest of the world wants part of its resources and growing retail market, perhaps the government will support MFOs through a multidimensional lens. Effective lobbying coupled with microcredit in Russia will liberate Russian entrepreneurs and launch the country towards a path of national development.

]]>The Preschool Built by Bitcoinhttps://www.borgenmagazine.com/the-preschool-built-by-bitcoin/
Tue, 18 Dec 2018 09:30:44 +0000http://www.borgenmagazine.com/?p=130132In early 2018, a new preschool opened its doors in Rwanda, thanks to Bitcoin donations. This preschool built by Bitcoin serves nearly 120 students, aged three to six years old, in the eastern district of Bugesera. Paxful, a peer-to-peer Bitcoin marketplace, and Zam Zam, a nonprofit organization focused on providing fresh water and education to [...]

]]>In early 2018, a new preschool opened its doors in Rwanda, thanks to Bitcoin donations. This preschool built by Bitcoin serves nearly 120 students, aged three to six years old, in the eastern district of Bugesera. Paxful, a peer-to-peer Bitcoin marketplace, and Zam Zam, a nonprofit organization focused on providing fresh water and education to villages worldwide, have partnered for the construction of this school, through the #BuiltwithBitcoin program. The school, as well as future projects #BuiltwithBitcoin has promised, is making pre-primary education more accessible in Rwanda.

Education in Rwanda

Although Rwanda is among the countries leading education in sub-Saharan Africa, barriers to education still exist. With a net enrollment of 98 percent of Rwandan children in primary schools, Rwanda has done a lot to increase access to education. However, to further this trend, access to pre-primary education must also be expanded. Currently, only 24 percent of Rwandan children are enrolled in pre-primary education programs.

Access to quality pre-primary education is one of four main points in Rwanda’s current Education Sector Strategic Plan, which also includes access to basic education, improving education quality and diminishing gender barriers. Paxful and Zam Zam’s combined efforts are bridging the gap in access to pre-primary education schools and programs in Rwanda.

The Preschool

The partnership between Zam Zam and Paxful has worked successfully by pairing local experience and unique fundraising. Zam Zam had previously constructed several wells in the province and gained the trust of the local community. While Zam Zam provided the land for construction and labor, Paxful orchestrated the donation of $50,000 in Bitcoin necessary for the construction. The preschool consists of three classrooms, four bathrooms and a water tank. It also offers free tuition to all its students, ensuring that all children have access to classes. The school even boasts several teachers who specialize in early childhood education.

The preschool has been a welcome addition to the local community. One local mother, Immaculate Zihinjishi, was extremely grateful for the preschool built by Bitcoin. It enables her young daughter, Lucky, to attend pre-primary classes, to which her older children never had access. She expressed her gratitude, saying, “We’re all very happy that these people came to help us and to build this school.”

Why Bitcoin?

Paxful started #BuiltwithBitcoin to demonstrate and encourage charity in the cryptocurrency industry. The CEO of Paxful, Ray Youssef, sees the success of #BuiltwithBitcoin as proof of cryptocurrency’s usefulness and value in the real world. Through encouraging donations in the form of cryptocurrency, #BuiltwithBitcoin and other projects, such as the BitGive Foundation, have been using Bitcoin and other cryptocurrencies to turn virtual currency into real-world change. While experts often debate the value of Bitcoin, initiatives like #BuiltwithBitcoin show the benefits that Bitcoin can bring to charitable causes around the globe.

The Next Step

In August, Paxful launched #BuiltwithBitcoin’s next goal: a new school for Rwandan students aged six to 15 yeard old. If all goes according to plan, the new school will be nearly twice the size of the preschool. The school will have six classrooms, each with a full-time teacher, and will cater to approximately 300 students. #BuiltwithBitcoin plans to build the new school in the Nyamata Sector of Rwanda’s Bugesera district, near the new preschool.

Paxful began the new school construction initiative by donating $20,000 towards the $100,000 goal. The rest of the funds will be raised through a crowdfunding campaign, accepting only cryptocurrency. Paxful plans to match each donation until enough funds have been reaised to build the school. Ultimately, the #BuiltwithBitcoin project aims to construct 100 schools and improve access to education across Africa.

]]>The Aftermath of the Economic Crisis in Greecehttps://www.borgenmagazine.com/greece-post-economic-crisis/
Wed, 12 Dec 2018 15:30:04 +0000http://www.borgenmagazine.com/?p=130080The economic crisis in Greece resulted in a long and complicated system of bailouts and austerity measures which plunged millions in poverty. Unemployment and food insecurity skyrocketed as the economy contracted. The consequences of the crisis are still tangible and will continue to shape the lives of the country’s people for years to come. The [...]

]]>The economic crisis in Greece resulted in a long and complicated system of bailouts and austerity measures which plunged millions in poverty. Unemployment and food insecurity skyrocketed as the economy contracted. The consequences of the crisis are still tangible and will continue to shape the lives of the country’s people for years to come.

The Crisis and Bailouts

Greece has had a turbulent past with the Euro ever since its adoption, but the global financial crisis of 2008 hit the country hard, resulting in insolvency. The extent of Greece’s trouble was revealed in 2009: its budget deficit was exceeding 12 percent of GDP. In 2010, Greece took their first bailout; in the decade that followed, the country had to adopt strict austerity measures directed by the EU and the IMF. Greece’s financial problems threatened to affect the entire eurozone.

On August 20, 2018, Greece took its third and final bailout. It seems that the danger has passed and many are now eager to turn a new page. In 2017, Greece’s economy grew by two percent. However, the country still has the highest debt in Europe: roughly 290 billion euros or 180 percent of its GDP. Unemployment is still high at 20 percent. More concerning is the fact that unemployment among the youth population is even higher, driving many young people out of the country. Greeks are still struggling to recover from a crisis that has been almost as painful and traumatic as the Great Depression in the United States.

The Support System

The economic crisis in Greece sent numerous middle-class households into poverty. Soup kitchens became filled with people who could no longer afford to provide for themselves. While struggling with the increased number of people to feed, soup kitchens across the country became the source of hope for people with no income. Food insecurity became a serious issue, and more than half of the 16,000 Greek families surveyed were suffering from food insecurity and child malnutrition and hunger rose exponentially. A 2014 report by UNICEF stated that child poverty rates in Greece have risen to over 50 percent since 2008.

The Stavros Niarchos Foundation is an organization which lent a hand to the increasing number of people living in poverty. The private organization gives grants to NGOs in different spheres, including social welfare and health. To help Greece, Niarchos Foundation established an emergency grant program: the Initiative Against the Greek Crisis. It was split into two programs, the first running from 2012 to 2015 and the second from 2015 to 2016. The grants, both around $90 million, were distributed primarily to social welfare and health sectors, with the remainder going to arts and education. The foundation aimed to alleviate social exclusion and provide food aid, temporary housing and healthcare to underprivileged groups. A Deloitte report reviewing the initiative found that more than 3,000 jobs were created or sustained.

Another approach to helping people in need and coping with the economic crisis in Greece emerged. Across the country, people began putting up walls of kindness: places where they hung items of clothing or left other products to be picked up by those in need. Clothes with the words, “If you don’t need it, leave it. If you need it, take it,” were hung up on walls along well-traveled routes, aimed to help homeless people during the winter. In addition to clothing, racks with food were left for people in need as well. These walls of kindness, each with its own Facebook page, started appearing in roughly 50 large and small cities throughout Greece.

A Personal Look at Post-Crisis Conditions

Giorgos Semkos is a resident of Thessaloniki, the second largest city in Greece. In an interview with The Borgen Project, Semkos shares, “During these years there is not a significant change to the situation. We have just adjusted to it.” He is echoing many who say that there is not much to be optimistic about. According to a 2017 Hellenic Statistical Authority survey, more than a third of Greece’s population – 3.7 million people – are at risk of poverty or social exclusion. The number has decreased from 2016 but remains dangerously high.

“The situation is not better. We are just used to it. We are now used to getting 500 euro per month compared to 800 euro some years ago,” says Semkos. What he calls a bitter but true fact is that the ongoing refugee crisis actually helped to reinforce the Greek economy. “A lot of money came into the Greek market to buy stuff for support of the refugees. If there wasn’t the refugee crisis, things in Greece would be much worse. It is sad to say, but true for me.”

Greece has not recovered yet, and according to data from the IMF, the country may not return to its pre-recession economic peak until 2030. In its latest report, the Organisation for Economic Co-operation and Development lists reducing poverty, improving workers’ skills, boosting employment and improving job quality as key recommendations for Greece’s recovery.

]]>Combating Poverty in Haiti with a Unique Solution: Gem Facetinghttps://www.borgenmagazine.com/combating-poverty-in-haiti-with-a-unique-small-business/
Tue, 11 Dec 2018 15:30:23 +0000http://www.borgenmagazine.com/?p=130076Haiti has had a spotlight targeting their national strife for decades. Most of the coverage has been focused on how torn and broken the country and people are after natural disasters, as well as how Haiti’s lack of funds is preventing clean-up. According to The New York Times, Haiti has been devastated by extensive flooding, [...]

]]>Haiti has had a spotlight targeting their national strife for decades. Most of the coverage has been focused on how torn and broken the country and people are after natural disasters, as well as how Haiti’s lack of funds is preventing clean-up.

According to The New York Times, Haiti has been devastated by extensive flooding, five hurricanes and an earthquake between 2004 and 2016. Due to a poorly performing agricultural sector damaged by natural disasters, the Haitian GDPslowed to 1.2 percent in 2017. According to surveys, 59 percent of Haitians are living below the poverty line of $2.41 per day. Additionally, 24 percent are living below the extreme poverty line of $1.23 per day. Since it is well-known that Haiti is one of the poorest countries in the world, many people and organizations have reached out to the country to offer aid. One college professor has found a unique and sustainable way to combat poverty in Haiti.

Dr. Bridge’s Focus on Haiti

Dr. Steven Bridge is a professor of Theology at Saint Joseph’s College of Maine. He has been the leader and coordinator for the annual International Service Trips since their inception in 2003. Saint Joseph’s College collaborates with Partners in Development (PID), an organization that has staff on the ground in Haiti.

The Borgen Project was able to interview Dr. Bridge about service trips specifically in Haiti. Dr. Bridge stated, “SJC is celebrating our 15th year of International Service Trips to Haiti with PID… It’s a holistic approach that ensures that the most vulnerable of children have basic access to food, medical care, and education; their families have clean, healthy, and stable living environments; and their parents can tap financial resources for the growth and development of their small-businesses or job training.”

After attending these trips for several years, Dr. Bridge began exploring ways that he could further battle poverty in Haiti. “My initial plan was to see if I could get some of them to the US and help them obtain college degrees. But that proved too difficult for a number of reasons. So I realized that if I was going to try to tackle this problem, it would have to involve bringing the training and opportunities to them.”

The Solution: Gem Faceting

A plan began forming in Dr. Bridge’s mind: “About 10 years ago, I learned to facet gemstones using semi-precious rough (clear & smoky quartz, amethyst, aquamarine, and tourmaline)… While on a service trip in Guatemala, I found a discarded shard of beautiful cobalt-colored glass and decided to try faceting it. It turned out really well.”

Speaking with the Haitians, Dr. Bridge realized that their desire was for financial self-sufficiency, education and job opportunities. “I hit upon the idea of faceting gemstones from discarded glass. I realized that if I could donate a machine and train some workers, then we would have the makings of a small-business initiative.” PID provided Dr. Bridge with a small workplace, workers and the necessary power to run the equipment he needed. They then began faceting glass into beautiful jewelry and have been in business ever since.

The most brilliant part of this operation is its sustainability. While not for everyone, gem faceting is a skill that can be taught to many people, and as the business grows, more machines and employees can be plugged in. Most importantly, there will never be a shortage of glass waste as raw material. “We now have a Haitian worker who has become quite skilled and proficient at faceting. She has become the General Manager of this operation as a salaried employee… This project has changed her life dramatically, as she now has a dependable, regular income which enables her to support her family. We also have several other gem-cutters on the payroll who are able to earn good wages as they continue to hone their skills and fulfill orders.”

These “orders” that he refers to are from a website that PID helped set up to sell the Jewelry made by the Haitians and Dr. Bridge. It is an Etsy website that has been quite successful. The online store also features crafts from Guatemala and other nations where PID has had an impact.

Looking Forward

Lastly, Dr. Bridge spoke to the future of the operation. “I am now in the midst of a 3-year Faculty Development Grant funded by SJC that is designed to help take this small business initiative to the next level. For the 2017-18 school year, we fully funded the construction of a brand new Lapidary Arts Center in the PID compound in Haiti. This new Center, which officially opens in December, will provide much-needed space for the expansion of our program. In conjunction with its opening, PID is adding a second faceting machine to help increase production. For the 2018-19 school year, we’ll be focusing on increasing the profile of our product with a more robust marketing campaign. And in 2019-20, we hope to add a third machine to boost not only production, but also job training opportunities for the Haitians. If the consumer demand is there, we could conceivably provide full-time employment for up to 18 Haitians with those three machines in the new Lapidary Arts Center.”

This would equate to 18 Haitians no longer living below the poverty line while helping to clean up waste and create beautiful, hand-crafted jewelry. Combating world poverty comes in many forms, but few are as unique and sustainable as the Gem Faceting initiative by Dr. Bridge and PID.

]]>Mauritius Launches Smart City Aimed at Economic Transformationhttps://www.borgenmagazine.com/mauritius-launches-smart-city/
Tue, 04 Dec 2018 15:30:03 +0000http://www.borgenmagazine.com/?p=129989SEATTLE — Located in the Indian Ocean 500 miles off the coast of Madagascar, the country of Mauritius is barely 10 times the size of Washington DC. Despite its size, but the country is attempting something big: creating an environment for potential investors and new jobs with its Smart City Scheme. Mauritius has already found [...]

]]>SEATTLE — Located in the Indian Ocean 500 miles off the coast of Madagascar, the country of Mauritius is barely 10 times the size of Washington DC. Despite its size, but the country is attempting something big: creating an environment for potential investors and new jobs with its Smart City Scheme. Mauritius has already found success in moving from an economy based primarily on sugar exports and tourism to one based on finance, business and banking outsourcing. The island nation now boasts one of the most successful economies on the continent. If this Smart City Scheme project proves successful, it could provide a blueprint for more African smart cities to follow their own path to prosperity.

Mauritius’ Vision of a Smart City

Many governments and corporations have planned and created smart cities all over the world. A smart city is defined as “a city that incorporates information and communication technologies (ICT) to enhance the quality and performance of urban services such as energy, transportation and utilities in order to reduce resource consumption, wastage and overall costs.” These cities are meticulously planned to ensure maximum efficiency and quality of life for residents.

For Mauritius, a smart city is described as a “concept of urban development focused on improving the quality of life of city dwellers by making the city more attractive, adaptable, efficient and resilient to change, using new technologies that rely on an ecosystem of objects and services.” For example, one of the African smart cities, Cap Tamarin, will contain 400,000 square meters of residential zones, as well as featuring a large park accessing one of Mauritius’ scenic beaches. The city will also include a “smart citizen advice office” and other public services such as a post office and a school. Additionally, researchers and up-and-coming businesses will have “innovation centers” available for their use.

Mauritius’ Smart City Scheme, launched in 2015, hopes to create working, living and leisure space that promotes environmental friendliness and generates its own resources. Additionally, the Smart City Scheme aims to provide enhanced connectivity, modern transportation services and reduced traffic congestion. The idea has gained traction with businesses and private investors; estimates state that the project has attracted more than $3 billion in private investments.

The Reasons Behind the Smart City Scheme

Mauritius tapped into the potential of smart cities to become more competitive as a nation. The Mauritius Smart City Scheme was implemented “not just for the sake for creating jobs,” explains Finance Minister Vishnu Lutchmeenaraidoo, “but mainly to prepare for the future as Mauritius aspires to become a major economic power in the region.” He continued, “The challenge is to reinvent the whole paradigm of Mauritius. So let’s reinvent the economy that was built on sugar, tourism, EPZ [export processing zones]and offshore. If we make it, we become one of the most developed countries in the region. If not, we stay a middle-income country.”

Praises and Criticisms of Smart Cities

This vision for African smart cities has already attracted investment to the continent. This investment has the potential to create a dynamic economy, provide new employment opportunities and deliver infrastructure for new businesses and foreign investments. However, an important question remains: will the smart cities help or hurt the 9.4 percent of households in Mauritius living below the poverty line?

Anjana Ahuja of the Financial Times wrote, “Without factoring in such civic intangibles as social justice and privacy, smart cities may end up being dumb places to live.” Referring to a proposed smart city near Mumbai, she stated, “its development threatens to displace around 40,000 residents, many of them farmers and fishermen with low levels of education. It is unclear where or how they would fit into a brand new Dholera.” A common criticism of smart cities is that they force people out of their modest homes.

Writer Ayona Datta offered other potential consequences of smart cities: “These new developments are largely privately owned, and sometimes even privately managed and governed. They run the risk of becoming enclaves of privilege, with private sector representatives already advocating the exclusion of the poor and marginalized through high prices and policing.” If these cities become tiny islands of wealth and perfect efficiency, it certainly will not bode well for low-income residents.

Looking Forward

The Smart City Scheme has the strong potential to bring money and jobs to Mauritius, helping diversify its economy and provide more opportunities for workers. However, leaders should be aware of the potential dangers of smart cities and work diligently to provide the best opportunities for all Mauritius citizens regardless of status or wealth. Thus far, experts on poverty and inequality have not sounded any alarms about Mauritius’ project. The Smart City Scheme may be a real victory for Mauritius, its citizens and other African smart cities.

]]>How Technology Can Stop Blood Diamonds https://www.borgenmagazine.com/how-technology-can-stop-blood-diamonds/
Tue, 27 Nov 2018 09:30:22 +0000http://www.borgenmagazine.com/?p=129932Diamonds are associated with many joyous and happy occasions: engagements, birthdays, anniversaries and even winning the Superbowl. For many people, diamonds represent wealth and personal milestones. However, for the many people involved in the diamond supply chain, the reality is a much darker picture. “Blood diamonds” have received their graphic name due to the violent, [...]

]]>Diamonds are associated with many joyous and happy occasions: engagements, birthdays, anniversaries and even winning the Superbowl. For many people, diamonds represent wealth and personal milestones. However, for the many people involved in the diamond supply chain, the reality is a much darker picture. “Blood diamonds” have received their graphic name due to the violent, unethical and horrific conditions in African diamond mines.

What Are Blood Diamonds?

The United Nations defines blood diamonds, or conflict diamonds, as gems “mined in areas controlled by forces opposed to the legitimate, internationally recognized government of a country and that is sold to fund military action against that government.” These diamonds can come from three regions in Africa: Angola, the Democratic Republic of the Congo or Sierra Leone.

Blood diamonds are often be mined by slaves, including children, and sales of these diamonds can fund wars and state violence, perpetuating poverty in these resource-rich African countries. Estimates state that 1 in 13 diamonds on the international market are conflict diamonds – a total of 65 million diamonds. Conflict diamonds are identical to other diamonds; once cut and polished, it is impossible to decipher a diamond’s origin.

How Blockchain Can Help Stop Blood Diamonds

Although consumers do not want to purchase these products, they have no way of knowing whether their diamonds were ethically sourced. Thanks to new blockchain technology, a diamond’s history now is easily accessible and impossible to manipulate. This technological breakthrough has the power that many have been searching for to stop blood diamonds.

Blockchain is the technology behind cryptocurrencies. Simply put, blockchain is “decentralized, public ledger technology.” As the name suggests, it consists of a chain of blocks, with the blocks being information and the chain being a public database. The blocks are all unique and are practically impossible to alter or edit. As changes are made or transactions occur, new blocks are added to the chain. Blockchain allows digital information to be recorded and distributed while preventing it from being edited. The information is stored with codes and resides in the virtual “cloud.” Bitcoin was the first non-hypothetical application of this revolutionary technology. Several industries have already taken advantage of blockchain, including securely storing private medical information, storing and verifying property ownership, keeping voting records and now illuminating the diamond supply chain.

A New Demand for Ethical Products

Recent reports show that consumers, especially millennials, would rather spend more money on genuinely ethical goods or find alternatives to purchasing problematic products like blood diamonds. Almost 75 percent of global millennials and 66 percent of all consumers are willing to pay more for sustainable, conflict-free goods.

An early tool in the fight against blood diamonds was the “Kimberley Process,” which the diamond industry adopted in 2003 to create documentation such as passports for the gems. Unfortunately, the process’s definition of “conflict diamond” does not include diamond mines using child labor, worker abuse or even “state-sanctioned violence.” For this reason, diamonds deemed acceptable through the Kimberley Process may still be considered unethical to many consumers. Even diamonds that fit the narrow definition slip into the process through various loopholes in the supply chain.

The Tracr Initiative

Lab-grown diamonds are growing in popularity, but are projected to account for less than 10 percent of market share in the next few years. Real diamonds are still in highest demand, and the De Beers Group has found a way to provide real gems without the blood. In January, De Beers announced the Tracr initiative to stop blood diamonds. Melinda Mutambaie Katende, a blockchain researcher at the University of Johannesburg, explained Tracr: “Unlike other commodities…individual diamond cuts have unique elements, these can be turned into data attributes that reinforce the immutability of every transaction on the blockchain.”

From the moment a diamond is mined until it is placed in a setting, information about the diamond will be added to the digital ledger and can be accessed by anyone. Consumers can look at the blocks to see where their diamond was mined and how it made its way through the supply chain. Tracr will be available to the entire diamond industry by the end of 2018. This initiative marks a major step toward an increase in transparency throughout the diamond industry and will empower consumers to support ethical diamond mining.

The international diamond jewelry market was worth an estimated $80.1 billion in 2016. Diamonds are a considerable business and draw high demand despite their high prices and potentially violent origins. With more consumers choosing diamonds whose origins are known, fewer will choose blood diamonds, which could eventually reduce demand to a point where the blood diamond mines are shut down. With proper implementation, Tracr and blockchain can take away power from violent mining groups while putting an end to blood diamonds and their victims.

]]>Nigerian Women Gain Financial Accesshttps://www.borgenmagazine.com/nigerian-women-gain-financial-access/
Mon, 26 Nov 2018 15:30:44 +0000http://www.borgenmagazine.com/?p=129929NIGERIA — Banking, especially online, is so common it hardly requires a thought for most people. In many developed countries, paying with the tap of a phone or the swipe of a card is practically second nature. This phenomenon is hardly universal, though, since bank account ownership is less common in developing economies. For Nigerian [...]

]]>NIGERIA — Banking, especially online, is so common it hardly requires a thought for most people. In many developed countries, paying with the tap of a phone or the swipe of a card is practically second nature. This phenomenon is hardly universal, though, since bank account ownership is less common in developing economies. For Nigerian women, however, getting a bank account is now becoming a new road to true financial independence with the possibility of freedom from poverty. While the gender divide remains worldwide in bank account ownership, new laws and innovative companies are helping Nigerian women gain financial access so that they may thrive financially.

The Gender Gap in Bank Account Ownership

The World Bank Group recently reported that, while global bank account ownership has increased worldwide, the gender divide remains. Currently, 72 percent of adult males have a bank account compared to 65 percent of adult females. This divide is even worse in developing countries where the gap between men and women is 9 percent. More than half of all adults without a bank account are women, most of whom live in developing countries.

The World Bank report listed several reasons why these women remain without their own accounts: Lack of a nearby institution, concern that they don’t have enough money to put into an account or a family member already has an account. Although, some of these reasons are changing. Fewer women are arguing they simply don’t have the money to put into an account because women in developing nations are already saving their money. In fact, some women are saving 10 to 15 percent of their earnings. These women aren’t lacking in capital to put into a bank, they’re facing cultural or institutional biases or other barriers.

Nigerian Women Gain Financial Access

Understanding the untapped market of women and the need for financial institutions to bring about economic gain, Visa and Women’s World Banking has partnered with Diamond Bank and Enhancing Financial Innovation & Access to provide easy-to-open financial accounts for the 77 percent of Nigerian women who did not previously have access.

Diamond Bank’s BETA accounts allow Nigerians a variety of ways to manage their bank accounts through their mobile phones, ATMs, at physical branches or with the help of BETA agents. The accounts are easy to open and don’t require passport photos or difficult-to-obtain documentation. The accounts’ debit cards are instantly activated, but there are still fees associated with application and maintenance.

Changes in Nigerian law have made now it easier for women to open to open bank accounts without documentation that may be difficult to obtain without a husband or guardian. One Nigerian woman, Amaka Charles, is hoping to use her new financial access to grow her small business. Opening a Diamond Bank BETA account has given Charles the freedom to start saving and growing her funds rather than keeping money sitting in a drawer or risking local informal collectors running off with her money.

The collectors, common in Nigeria, hold money for their clients and keep track of deposits in notepads. There is little to no recourse if the collectors leave town with their clients’ money. That risk was too great for Charles. She deposits her money with local bank agents who collect deposits in person after which Charles receives official confirmations from her phone that a deposit was made. This system allows for face-to-face contact with the bank in conjunction with the best of mobile banking technology available. Charles currently sells crayfish, but she is hoping her new bank account will allow her to expand the business through a loan.

Alleviating Poverty Through Secure Bank Account Access

A recent paper for the Review of Development Finance found that access to financial institutions can often aid in poverty reduction in a meaningful way. The study found that “financial deepening” is the most powerful tool to reduce poverty, followed by “increasing physical financial access.” Financial deepening referring to the availability of financial services. Thanks to Diamond Bank, BETA’s program has provided almost 40,000 Nigerian small business owners, many of whom are women, a stable financial institution.

Avoiding cash is standard in developed nations, especially for millennials and younger generations, but it’s a way of life for many other countries. Bank account access is a way for workers and business owners in developing nations to protect their financial gains and pull themselves out of poverty. The power of financial access is a given for poverty reduction, and Nigerian women gain financial access by taking advantage of this. Women like Amaka Charles are opening their first bank accounts and becoming the masters of their own financial destiny.

]]>Top 6 things to know about Ethiopian Airlineshttps://www.borgenmagazine.com/top-6-things-know-ethiopian-airlines/
Thu, 22 Nov 2018 09:30:07 +0000http://www.borgenmagazine.com/?p=129901ETHIOPIA…At the 2018 Arabian Travel Awards, Ethiopian Airlines was voted “Best African Airline” as a recognition of the carrier’s impressive expansion into new markets over the past decade. Indeed, to fuel Ethiopia’s growth and its booming tourism industry, Ethiopian Airlines plans to build a new airport with an annual capacity of 80 million passengers. In [...]

]]>ETHIOPIA…At the 2018 Arabian Travel Awards, Ethiopian Airlines was voted “Best African Airline” as a recognition of the carrier’s impressive expansion into new markets over the past decade. Indeed, to fuel Ethiopia’s growth and its booming tourism industry, Ethiopian Airlines plans to build a new airport with an annual capacity of 80 million passengers.

In addition to connecting Ethiopia to foreign investors and multinational companies, the airline has engaged with impoverished Ethiopians directly by funneling its profits into charitable causes. Here are six things to know about Ethiopian Airlines and its impact on economic development in Ethiopia:

Six Things to Know about Ethiopian Airlines

Ethiopia’s location in the Horn of Africa makes it a prime spot for aviation. In fact, the number of passengers flown by Ethiopian Airlines tripled from 2008 to 2017. In 2015, The United Nations stated that Ethiopian Airlines is Africa’s fastest growing and most profitable passenger and cargo airline. On the cutting edge of innovation, Ethiopian Airlines was the second carrier in the world to operate the Boeing 787 Dreamliner back in 2012. As of now, the carrier serves 101 international destination and 22 domestic ones.

Ethiopian Airlines is key for its country’s Vision 2025 framework, under which the government plans to make Addis Ababa the leading manufacturing hub of Africa. The national airline is already helping Ethiopia achieve Vision 2025 by connecting Ethiopia to China and South America. Last year, the carrier launched flights to Chengdu, China, and in 2018, Ethiopian Airlines has expanded into Buenos Aires, Chicago and Geneva.

The airline’s expansive network has helped to transform Ethiopia into a major tourist destination. In 2015, The European Council on Tourism and Trade named Ethiopia the world’s best tourism destination. That same year, 681,000 tourists visited Ethiopia, supporting a tourism industry that makes up 4.5 percent of the country’s GDP and provides more than one million jobs.

Ethiopian has made environmental protection a pillar of its corporate social responsibility. Under its “Plant one tree for every passenger flown” project, Ethiopian Airlines will plant nine million trees all across Ethiopia. Moreover, the airline trains its employees on proper waste management, treating hazardous chemical, monitoring air quality, and sustainable production. At the Ethiopian Aviation Academy, pilots-in-training can now take a course on The U.N. Environment Sustainable Consumption and Green Economy Program. Erik Solheim, the Head of U.N. Environment, applauded Ethiopian Airlines for “raising the bar on environmental responsibility and green business.”

Beyond its commitment to a green economy, Ethiopian Airlines uses its planes to deliver educational supplies to impoverished Ethiopians. For example, Ethiopian Airlines partnered with The African Legal Library Project, a nonprofit organization, to transport 40 boxes, which included 720 law books as well as 101 e-Readers complete with more than 1,000 books each, to Debre Markos University.

The airline has also used its planes to deliver medical aid to impoverished Ethiopians. In 2010, Ethiopian Airlines collaborated with Seattle Anesthesia Outreach (SAO) to deliver 12,000 pounds of medical supplies, mainly anesthesia equipment, to The Black Lion Hospital, Ethiopia’s largest hospital. To supplement the delivery of medical supplies, 20 SAO doctors also traveled to Ethiopia as part of a humanitarian trip. To this day, Ethiopian Airlines fills empty cargo space in its passenger planes with humanitarian supplies.

Rapid, sustained growth is in the airline’s horizon. In May 2018, Ethiopian Airlines accelerated its expansion plans, confirming that it will order 13 additional Boeing 787s and six Airbus A350s. According to The Brookings Institution, the airline plans to invest in start-up airlines across Africa.

It bought a minority stake in Malawi Airlines in 2013 and helped relaunch Zambia Airways in January 2018. Looking forward, Ethiopian Airlines plans to jumpstart national carriers in Chad, Djibouti, Equatorial Guinea and Guinea, signaling its desire to connect not only Ethiopia but the whole African continent to the global economy.

]]>Charitable Search Engineshttps://www.borgenmagazine.com/charitable-search-engines/
Sun, 18 Nov 2018 09:30:21 +0000http://www.borgenmagazine.com/?p=129839SEATTLE — If you’re reading this, we can assume two things. One, you have access to the internet, which means you have more than likely used a search engine service such as Google or Bing. And two, since you’re reading on The Borgen Project’s webpage, you are concerned with global poverty and probably want to [...]

]]>SEATTLE — If you’re reading this, we can assume two things. One, you have access to the internet, which means you have more than likely used a search engine service such as Google or Bing. And two, since you’re reading on The Borgen Project’s webpage, you are concerned with global poverty and probably want to help address this issue in any way you can. Charitable search engines will help you achieve that.

4 Charitable Search Engines Aiding Poverty Alleviation

Perhaps you don’t have money to donate, but the following 4 charitable search engines have found a way to bridge that gap for you by donating their revenues to charitable causes.

Sleio

Sleio.com is a search engine founded by a native of Prague, Thomas Vavrys, in 2014. Sleio operates much like Google or any other search engine except that it donates 100 percent of its profits to charity. Sleio has partnerships with more than 30,000 retail websites and donates the money it makes from commissions to your choice of charity. Every time you click a link through its website, you boost its ad revenue and thus increase the amount of money it is able to donate to charities.

Users are able to scroll through Sleio’s affiliated nonprofits and add them to their own personal causes. This ensures the revenue Sleio receives from a user’s activity goes to the charities they choose. Some of Sleio’s charitable partnerships include Charity: Water, whose mission is to provide clean and safe drinking water to every person on the planet; Kiva, the poverty-centered nonprofit that focuses on alleviating poverty across the globe; and the Immunity Project whose purpose is to develop an HIV vaccine. Sleio rakes in about $200,000 a year in ad revenues—which goes a long way toward helping the world’s poor.

Helpuu

Helpuu.com is an online portal that uses Google’s search algorithm and operates much like Sleio. Helpuu receives ad revenues from its partners. Every time you search through Helpuu, it receives a commission which in turn gets donated to a variety of charities. Helpuu’s website claims that every person who sets their homepage to Helpuu during the course of a month is feeding a starving child for about 3 months. This means that if 5 percent of the U.S. population were to make Helpuu their browser’s homepage, 1,000,000 starving children could be fed every single day.

Helpuu has partnered with Feed the Children, a nonprofit organization with the goal to end global child hunger. Feed the Children boasts 93 percent of its total expenditures went toward service programs to reach that goal.

iGive

iGive was founded by e-philanthropist Robert Grosshandler is 1997, making it one of the first online charity malls. iGive isn’t a search engine per se but more of an online shopping mall or e-retail aggregator. iGive has partnered with around 2,000 of the world’s most visited retailers such as Walmart, Walgreens, Best Buy and more. These stores donate to charities on iGive’s behalf, if you use their services. The stores then pay iGive a commission of which 26 percent is also passed on to charitable causes supported by iGive.

Once you sign up, iGive’s “The Button” remains active on your browser and automatically creates a donation with every purchase you make. You even get to see how much donation your purchase generates at the time of checkout. iGive has donated more than $8 million since its inception and allows the user to choose which nonprofit they would like their proceeds to go to. The Borgen Project is listed on this site, so be sure to include us in your list of causes.

Goodshop

Goodshop.com is an online search engine and coupon aggregator that has the “most powerful coupons in the world.” Not only does it use a Yahoo!-powered search engine that generates about a penny every time you do a search, but it also has a database of e-coupons that saves you money on your online purchases. Goodshop then passes those savings on to charities of your choice.

Goodshop has partnered with more than 3,000 stores including the retail giant Amazon that donates 1.5 percent of every purchase done via Goodshop. How it works is that you sign up on Goodshop’s website and browse through its catalog of more than 25,000 coupons. When you click on these coupons, Goodshop notifies the retailer that it referred you to the retailer’s site and in turn receives a referral fee.

Goodshop donates 50 percent of that fee to the charity of the user’s choice. It has several partnerships with nonprofits to choose from so the user can select a cause they are passionate about. Goodshop has donated more than $11 million to charities since their inception.

]]>Lunch Delivery System in Indiahttps://www.borgenmagazine.com/dabbawala-lunch-delivery-system/
Sat, 17 Nov 2018 09:30:26 +0000http://www.borgenmagazine.com/?p=129821Mumbai — “Dabbawalas” lunch Delivery System in India refers to an inexpensive economic system where hot homemade lunches are delivered to people at work and empties are picked up. Every day, over 5,000 delivery men deliver 200,000 lunchboxes in Mumbai. Lunch Delivery System in India The exclusive use of bicycles and railways for delivery is leading [...]

]]>Mumbai — “Dabbawalas” lunch Delivery System in India refers to an inexpensive economic system where hot homemade lunches are delivered to people at work and empties are picked up. Every day, over 5,000 delivery men deliver 200,000 lunchboxes in Mumbai.

Lunch Delivery System in India

The exclusive use of bicycles and railways for delivery is leading to zero consumption of fuel, and the use of reusable metal containers, which locals refer to as “Tiffin,” makes this an eco-friendly enterprise. Hot, healthy and fresh food, costing around $7-9 per month for some 20 meals, is delivered around the city. This service provides the citizens, especially the office going population, a nutritious alternative to fast food.

This supply-chain management system is unique to India and is known for its reliability and accuracy. The speed, efficiency and precision by which the Dabbawalas organize the preparation and delivery is virtually unheard of in any such system. It has been in existence now for over 100 years.

Forbes Magazine gives the operation of dabbawalas in India a Six Sigma rating, with an efficiency rating of 99.999999. There are simple but effective coding and tracking systems that allow Dabbawalas to effectively deliver lunch boxes to their customers. The coding system includes the destination and route of each lunch box. The Dabbawalas barely use technology or paperwork since most of them are not fully literate, yet they manage such high levels of accuracy. Some say the key is commitment and a sense of pride in the Dabbawala enterprise.

Supporting the Economy and Employing Women

This system promotes self-employment and entrepreneurship not just for the Dabbawalas but also for women who cook the food in a centralized kitchen. The food preparation is customized to the customers’ preferences. In today’s world, when more women are pursuing careers outside the home, the Dabbawalas are offering a service where their wives do the cooking, thus supplementing household income. This provides employment for women at home in a convenient and effective way.

In tune with the changing times, today more women are joining the Dabbawala community and breaking into new roles, including food delivery. This leads to economic advancement and empowerment. Each Dabbawala earns an equal amount of around $150 a month, and they consider themselves as self-employed.

By slowly integrating technology into their system by allowing customers to use SMS services to order their lunch boxes, the Dabbawalas continue to increase their profits. Creating a website has also increased orders and enquiries. The business has been growing by 5-10 percent each year.

Helping the Poor and Reducing Food Waste

Dabbawalas in India started a ‘Roti Bank’ in 2015 to reduce food-wastage and feed the poor in Mumbai. By teaming up with caterers and wedding planners around the city, the Dabbawalas are using their unique network around the city to collect leftover food and distribute it to the poor and homeless. They are using their skills and are volunteering their time for this purpose. In fact, many Dabbawalas have been working after their shifts are over to pick up and deliver food and, thus, use this decentralized system for the good of the community.

The “Share My Dabba” campaign is another such effort to encourage customers to share leftover food, which can be distributed to the poor by Dabbawalas. This helps in addressing issues of economic inequality and food waste.

Even though food delivery apps such as UberEats and Zomato are gaining traction in Mumbai, they do not have the popularity of the Dabbawalas. Here, it can be seen that in a bustling metropolis like Mumbai, the success of a unique food delivery system, which uses manual labor rather than automation, can continue to enjoy great success.

Dabbawalas in India have gained a reputation of being punctual, efficient and precise, and have a special place in the hearts of many in Mumbai. This operation shows how the ingenuity of people, even with a lack of technology, can create products and services that stand the test of time, and bring together local talent to touch both hearts and stomachs.